The method and merit of Facilities Management (FM) delivery – be it in-house, total, bundled or single stream – has been debated for many years. Getting the correct delivery model for a specific contract has never been more important, especially so with market volatility arising from events such as Brexit. Uncertain times mean the correct service structure and management is essential to securing and meeting targets set out when the contract was tendered. In truth, these models are valid within certain circumstances, and it can never be a case of ‘one size fits all’. Public sector contracts in particular require an absolute assurance of delivery; the scrutiny which large central government departments face means that nothing other than exceptional service for the best possible value is acceptable. The requirement to improve productivity and efficiency is a key motivation not only in the public sector, but with FM in general. Additionally, the need to extract as much value as possible is crucial. This market development has seen a reduction in team resources and has consequently created challenges with delivery capability for both in-house and outsourced offerings.
With SME’s being championed by the government and encouraged to bid for large public sector contracts, the need for smaller businesses that are able to deliver is paramount. The demand to meet service expectations while simultaneously keeping costs to a minimum can be burdensome for smaller businesses, and the overall quality of their service can suffer if it is not managed correctly. The workload that a public sector contract generates can put disproportionate strain on the supplier’s resources and potentially be self-defeating. It is right that SME’s should be encouraged to win major contracts with central government departments; this competition is undoubtedly good for stimulating the economy and safeguarding future prosperity. However, if the contract creates serious issues for the entire business, then this needs to be addressed in a strategic way that helps an SME deliver on expectations while also safeguarding their resources so they are not stretched too thin.
In my experience at KBR, the best method for alleviating this problem is to use an integrated service delivery model (ISDM) that provides the client with a stand-alone matrix of processes, resources, skills and knowledge to manage the execution of its services. This particular model means that the service is capable of meeting the specific needs of each client. From the beginning of an agreement, the sourcing strategy is devised and the supply chain is mobilised while day-to-day management is continually monitored. The bespoke nature of this model means that an integrator can deal with issues – anticipated or unforeseen – while still ensuring that FM services are delivered throughout the contract term as agreed. The single integrated system also ensures that monitoring is non-intrusive and the data accrued is simple to interpret and utilise.
The ability to monitor FM and property performance data means trends can be established and delivery can be modified accordingly. This is a great opportunity for SME’s as the model allows for continual improvement while not physically interfering in the actual execution of FM services from the client itself. The SME can fulfill its contract while benefitting from the influence that an IDSM brings, thus alleviating the potential service stress of a major public-sector contract. If there is a particular issue, it will be identified and discussed with the provider who then makes changes as appropriate – essentially the process of troubleshooting and optimisation is simplified for all parties and the job gets done. Conversely, this model also allows for an integrator to deliver everything independently, if desired. A key benefit of ISDM is its flexibility and applicability.
This model has enjoyed demonstrable success. In 2013, the Metropolitan Police Service (MPS) went through the biggest transformation of its estate to date. KBR were employed to develop an integrator model which oversaw a total restructuring of its facilities management with the aim of saving £5 million pounds a year. Three years on, the MPS is now seeing £10 million a year in savings, service satisfaction has improved, and the number of SME’s working alongside the MPS has increased by 40 per cent. Integrator payment arrangements are also typically made on a fee basis, so no amount is taken from the original contract agreement itself. The SME is therefore never short-changed in the process; it is a mutually beneficial collaboration. Having an integrator involved is not a prerequisite to an SME’s success in major public contract negotiations, but the assured service they can bring for all parties will certainly make any prospective bid more desirable. Food for thought for those aspiring to supply in the public arena.
As managing director for Facilities Management Services, Colin holds strategic responsibility for the direction and growth of the FM Services business across the UK for KBR. His remit includes Business Development and acquisition: securing contracts, and negotiating at executive level with major clients in both the public and private sectors.
